Medicare Refresh

shj090616_medicare_refresh_blog_imageDuring working years, most individuals have little choice in their health insurance coverage. Employees and their family members typically enroll in the health insurance plan offered by their employer and don’t ‘shop’ for a personal policy unless self-employed. However, once you turn 65 and are no longer working, typically you have choices to make about Medicare!

Each individual has their own initial enrollment period, which begins 3 months prior to your 65th birthday and ends 3 months following your 65th birthday. If you want your coverage to start the first day of your birth month, you will want to enroll within the 3 months leading up to your birthday. If you are 65, still working, and enrolled in a group policy that covers 20 or more employees, you are eligible for an extended special enrollment period where you can enroll in Medicare after your 65th birthday. To avoid late enrollment penalties, you will need to enroll within 7 months of your group coverage ending. If you miss both of these enrollment periods you are eligible to enroll in Medicare during the general enrollment period January 1 – March 31, annually. However, late enrollment penalties may apply for each year you delay signing up. Continue reading

Thinking of Relocating When You Retire? Remember to Talk to Your Financial Planner

Rocky Mountains mountain home moving to the mointains.

Recently some of our clients came in for an annual review with Stephen Weatherby, CFP®. During their meeting they casually mentioned they were thinking of moving to a small mountain town in Colorado when they retire next year.

Little did they know, Stephen is well connected in the town they are considering moving to and immediately went to work researching on their behalf. Through his personal network he connected them with a trusted realtor, an attorney, and insurance agents. He even found short term storage facilities and an agent who specializes in short term rentals. Continue reading

Watch those Medicare Part B & Part D (Prescription Drug Coverage) Premiums: You May be Paying Higher Premiums than you Should!

Sharkey_Howes_Javer_Glasses_Monthly_Adjusted_BlogFor our seniors 65+ and those caring for seniors…

Did you know that if your income has dropped significantly you may be eligible for a reduction of your Medicare Part B & and Part D (Prescription Drug Coverage) premiums?

If you’ve ever received a letter from Social Security telling you that your income level causes you to pay extra premiums on your Medicare Part B and Part D, then you should be aware of these rules.

The Social Security Administration receives data that is two-years old, specifically your Modified Adjusted Gross Income (MAGI), each year from the Internal Revenue Service (IRS) and uses this information to determine the amount of your monthly premiums. If your income has dropped below specific thresholds, your premiums will decrease and vice versa. See the chart below for a breakdown of income levels and premiums required in 2016.

SHJ Tax Return Comparison Chart(source)

The important thing to note is that you don’t have to wait for two years for Social Security to get updated information from the IRS. Instead, if you know your MAGI has dropped below the income threshold on which your current premiums are based, then you can file an appeal along with some required documentation of your current MAGI and request a review.

Required documentation is:

  • A copy of your filed tax return and an IRS transcript;
  • A letter or statement from the IRS stating they have corrected your tax information and explaining the correction;
  • Your amended tax return, along with a letter from the IRS accepting your amended return or an IRS transcript; Your copy of your tax return that shows an obvious IRS transcription error in tax-exempt interest income; or
  • Your declaration under penalty of perjury that you lived apart from your spouse for the entire year when you filed your income tax return as “married Filing separately”. (source)

If the Social Security Administration finds that you’ve been paying a higher premium than you should have been, then they will refund the excess within 30 days of notifying you of their findings. So don’t wait, keep an eye on your income level and if you’re due a reduced premium, get filing!

For additional information read publications, Medicare Premiums: rules for Higher-Income Beneficiaries (SSA Publication No. 05-10536) and Medicare Premiums: What You Can Do If you Think Your Income-Related Premium Is Incorrect (SSA Publication No. 05-10125).

Medicare: Wading Through the Alphabet Soup

How did Medicare get started? Let’s see how you do on this quiz.

  1. Which U.S. President signed Medicare as a law? (source)
    Answer: Lyndon B. Johnson 
  2. How many people signed up for Medicare in 1965, its first year? (source)
    Answer: 19 million 
  3. Before Medicare was signed into law in 1965, how many revisions had been drafted? (source)
    Answer: Approximately 80 revisions, compromises, and alternatives.

With 80 revisions, you can quickly assess how difficult it was to create Medicare from the very beginning. Over time, the Medicare system has not decreased in complexity.

For many people, their 65th birthday is an extra-special celebration because of Medicare enrollment. However, the wrapped gift of Medicare comes with a very confusing tangle of ribbons and bows.

Continue reading